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How Much Do We Know about the Impact of the Economic Downturn on the Employment of Migrants?

Author

Listed:
  • Xin Meng

    (Asian Development Bank Institute)

  • Sherry Tao Kong
  • Dandan Zhang

Abstract

The employment shock of late 2008 in the Peoples Republic of China (PRC) may have been a product of three different events : (i) the contractionary macroeconomic policies introduced by the government and the central bank in 2007 to slow growth, (ii) the introduction of the new Labor Contract Law at the start of 2008, and (iii) the reduction in export orders due to the global financial crisis from the second half of 2008. These three events occurred sequentially, and their impact on employment has been borne most heavily by ruralurban migrants. Using unique data that track 5,000 migrant households in 15 cities from 2008 to 2009, this paper documents the size of the employment impact of the economic downturn, investigates the geographic location and industry distribution of the effect, and examines the types of migrant workers who lost their jobs in 2008 because of the economic downturn. We find that job loss is not confined to export manufacturing industries, nor is it restricted to coastal cities where export industries are located. We interpret this widespread job loss to indicate that the employment shock that took place in the PRC at the end of 2008 and early 2009 was a response to both the global financial crisis and domestic economic policies.

Suggested Citation

  • Xin Meng & Sherry Tao Kong & Dandan Zhang, 2010. "How Much Do We Know about the Impact of the Economic Downturn on the Employment of Migrants?," Labor Economics Working Papers 22901, East Asian Bureau of Economic Research.
    • Handle: RePEc:eab:laborw:22901
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    References listed on IDEAS

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    1. Meng,Xin, 2009. "Labour Market Reform in China," Cambridge Books, Cambridge University Press, number 9780521121118, November.
    2. Devine, Theresa J. & Kiefer, Nicolas M., 1991. "Empirical Labor Economics: The Search Approach," OUP Catalogue, Oxford University Press, number 9780195059366.
    3. Haiyan Wang & Richard Appelbaum & Francesca Degiuli & Nelson Lichtenstein, 2009. "China's New Labour Contract Law: is China moving towards increased power for workers?," Third World Quarterly, Taylor & Francis Journals, vol. 30(3), pages 485-501.
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    Cited by:

    1. You, Jing & Wang, Shaoyang, 2018. "Unemployment duration and job-match quality in urban China: The dynamic impact of 2008 Labor Contract Law," Economic Modelling, Elsevier, vol. 71(C), pages 220-233.
    2. Wenjin Long & Simon Appleton & Lina Song, 2017. "The impact of job contact networks on wages of rural–urban migrants in China: a switching regression approach," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 15(1), pages 81-101, January.
    3. Maria Csanadi, 2010. "Reactions to Short-Term Adaptation Pressures During Transformation in Party-States: The Case of China," CERS-IE WORKING PAPERS 1031, Institute of Economics, Centre for Economic and Regional Studies.
    4. Jason Hung, 2020. "Psychosocial Wellbeing Among Rural Migrant Workers in China: Did the 2008 Financial Crisis Worsen Their Vulnerability?," Asian Social Science, Canadian Center of Science and Education, vol. 16(1), pages 1-54, January.
    5. Xiumei Wang & Ye Jiang & Famin Yi, 2024. "Digital Revolution and Job Quality of Lower Class Workers: Quasi‐experimental Evidence from the Broadband China Program," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 32(4), pages 146-178, July.
    6. Qu, Zhaopeng & Zhao, Zhong, 2017. "Glass ceiling effect in urban China: Wage inequality of rural-urban migrants during 2002–2007," China Economic Review, Elsevier, vol. 42(C), pages 118-144.
    7. Jiang, Ye & Zhang, Tonglong, 2025. "When economic downturn hits bottom workers: Labor market entry conditions and long-term career effects," China Economic Review, Elsevier, vol. 91(C).
    8. Long, Wenjin & Appleton, Simon & Song, Lina, 2013. "Job Contact Networks and Wages of Rural-Urban Migrants in China," IZA Discussion Papers 7577, Institute of Labor Economics (IZA).

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    Keywords

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    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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